Riverside Press-Enterprise deal completed

Freedom Communications Holdings Inc., the owner of the Orange County Register, on Thursday completed a $27.25 million deal with Dallas-based A.H. Belo Corp. to buy The Press-Enterprise, a daily newspaper in Riverside.

The Riverside deal expands Freedom's footprint in Southern California and is the latest move by the Santa Ana-based media company, which launched a daily Long Beach edition in August.

“Our focus moving forward will be to enhance the ways we can provide value to subscribers of The Press-Enterprise and the greater community,” said Aaron Kushner, chief executive of Freedom and publisher of the Register.

Jim Moroney, chief executive of A.H. Belo, said the sale benefits all involved.

“It's a good thing for The Press-Enterprise organization, especially because we believe the Los Angeles newspaper market will continue to consolidate,” he said. “When that happens, it's better to be with those consolidating rather than the last option in a consolidating market.”

Thursday's closing brings to an end several weeks of speculation after Freedom missed its initial deadline to close the deal in mid-October and then a second deadline on Nov. 15. On Monday, A.H. Belo, which is a public company, announced that the deal had not closed and the company was pursuing its alternatives, including possible litigation against Freedom.

On Thursday, Kushner played down those concerns, noting that buying The Press-Enterprise was a large transaction and had to be handled properly.

“We've closed just like we said we would close,” he said.

With The Press-Enterprise, Freedom's newspaper circulation in the area increases by nearly 50 percent. The Register's print-only circulation averaged about 150,000 Monday through Saturday as of Sept. 30, according to the Alliance for Audited Media, which tracks newspaper circulation. The paper's Sunday print circulation is 267,000.

The Press-Enterprise averaged about 81,000 daily for print-only circulation and 105,000 on Sunday.

Kushner said he plans to bring the same brand of journalism to Riverside that he and co-owner Eric Spitz rolled out at the Register since their 2100 Trust LLC bought Freedom last year.

Unlike other newspaper owners that have cut staff and pages, Kushner's focus has been to provide more value to subscribers by expanding the Register's news and feature offerings. That includes more than doubling the newsroom staff and dramatically expanding community coverage and editions throughout Orange County.

The company also expanded two local weeklies – The Current in Newport Beach/Costa Mesa and the Irvine World News – to five-day-a-week dailies and launched the Long Beach Register, its first new newspaper outside of Orange County. The Long Beach Register is adding a new Sunday edition starting next week.

Kushner said that if he successfully builds a loyal subscription base, advertisers will follow, creating what he describes as a virtuous circle of growth.

Register Editor Ken Brusic said he looks forward to working with The Press-Enterprise staff and that expanding regional coverage will benefit readers in both areas.

“It's a bold and wonderful step for Southern California print and digital journalism and the communities we serve,” Brusic said. “We will learn from one another and provide more news, investigations, sports, features and entertainment.”

Although the purchase allows Freedom to expand into a new market, Riverside also presents challenges.

The Press-Enterprise, hit by the double-whammy of the industry-wide drop in advertising combined with the recession, has struggled in recent years. The newspaper has 375 full- and part-time employees, down from 1,165 in 2006.

In July, A.H. Belo sold The Press-Enterprise's five-story headquarters to the county of Riverside for $30 million – about $3 million more than Freedom paid for the newspaper. The Press-Enterprise is leasing space in the building until the staff can move to new offices nearby.

The Freedom deal includes the production facility, which houses the presses in a building next to the newspaper's current leased building, and the company's website, PE.com. A.H. Belo will retain and plans to sell a discontinued commercial printing operation nearby and a church that is on Press-Enterprise property.

“We appreciate the stewardship provided by A.H. Belo to The Press-Enterprise, an institution that plays an incredibly important role in building community and adding richness to people's lives,” Kushner said.

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